Good problems to have

Last August the Reserve Bank devised its strategy for how Australia should exit from the extraordinary economic settings that it had put in place to tackle the global meltdown. When it became clear that the Australian economy had dodged a recession, the bank decided to gradually bring interest rates back to normal levels. Only timing was at issue. As the doubts have fallen away, the RBA has inexorably tightened monetary policy. Yesterday it hiked official rates for the fourth time in six months in an emphatic recognition that the economy, overall, is recovering strongly.